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Average Incomes for Workers 25-34 Have Fallen Twice as Fast

“This generation will be permanently depressed and will be on a lower path of income for probably all of their life -- and at least the next 10 years,” says Rutgers professor Cliff Zukin, a senior research fellow at the university’s John J. Heldrich Center for Workforce Development.

The news from the "Recovery" front isn't looking too good. Instead it's looking a whole lot like permanent underemployment and downward mobility may be here to stay... at least throughout the Obama era.

Generation Y professionals entering the workforce are finding careers that once were gateways to high pay and upwardly mobile lives turning into detours and dead ends. Average incomes for individuals ages 25 to 34 have fallen 8 percent, double the adult population’s total drop, since the recession began in December 2007. Their unemployment rate remains stuck one-half to 1 percentage point above the national figure.

Three and a half years after the worst recession since the Great Depression, the earnings and employment gap between those in the under-35 population and their parents and grandparents threatens to unravel the American dream of each generation doing better than the last. The nation’s younger workers have benefited least from an economic recovery that has been the most uneven in recent history.

“This generation will be permanently depressed and will be on a lower path of income for probably all of their life -- and at least the next 10 years,” says Rutgers professor Cliff Zukin, a senior research fellow at the university’s John J. Heldrich Center for Workforce Development.

Michael Greenstone, who was chief economist at the White House Council of Economic Advisers in 2009 and 2010, says the shift to a downwardly mobile society may be lasting. “Children are not earning as much as their parents, and I think we’re laying the seeds for that to continue into the future,” he says.

On the one hand this gives the welfare state a political boost. On the other hand it's wiping out the income base for the welfare state.